Page 2 - Cover Letter and Evaluation for Stephen Spero

or another plan. Then it’s a good idea to call three or more insurers and get
current quotes before deciding which company you’ll get your policy from.

 To enroll in the Part D stand-alone plan that has the lowest costs for your Rx
drugs, call the plan’s toll-free number, which is shown on page 4 of the
evaluation, in Appendix D2, and in the Rx drug coverage section below.

The two Medigap plans in your evaluation

Two of the four options compared in your evaluation are Medigap policies – Medigap Plan G
and Medigap Plan N.

It might be helpful to review certain features that all Medigap policies share (you may already
be aware of these). Perhaps their most desirable of these is the flexibility they offer. There are
no networks, and you are covered when you see any provider who accepts Medicare (as some
99% of doctors and public hospitals do). With a Medigap policy, you can go to virtually any
doctor, public hospital or clinic in the United States and be covered. Your three physicians
accept Medicare, as shown in Appendix A1.

Another strength of Medigap policies is that Medicare, not the insurance company, makes the
coverage decisions. And if Medicare approves a service or treatment, the Medigap insurer must
also cover it, up to policy limits. Because Medicare is more lenient in approving certain
treatments than are insurance companies, Medigap policyholders may in some cases be
covered for treatments that people in Advantage plans may not be (the insurance company
could say that the treatment is not medically necessary). For that reason, people with pre-
existing conditions will typically choose to get a Medigap policy if they are comfortable paying
its higher premiums.

Medigap policies do not cover routine vision and dental care or hearing aids, none of which are
covered by Medicare. Neither do they cover prescription drugs, and so if you get a Medigap
policy you will also need to enroll in a Medicare prescription drug plan (Part D stand-alone
plan). And with the exceptions of seldom sold Plan K and Plan L, Medigap policies do not have
out-of-pocket limits, although that is rarely an issue because Medicare’s underlying
catastrophic protection is strong. Some Medigap plans, including the two compared in your
evaluation, include coverage for foreign travel emergencies.

During the first six months that people have Part B, insurance companies are required to sell
them Medigap policies without asking health-related questions. But after that six-month
guaranteed issue is past, in California and most other states insurance companies can ask
applicants about pre-existing conditions and can charge higher premiums or deny coverage. In
most cases, then, people’s only opportunity to get a Medigap policy without answering
questions about their health status is the six-month period that starts when their Part B
coverage begins. Even so, younger retirees in good health sometimes wait until later to buy
their first Medigap policy, knowing there is a risk they may later be denied coverage.

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